<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
COAST DENTAL SERVICES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
COAST DENTAL
COAST DENTAL SERVICES, INC.
2502 NORTH ROCKY POINT DRIVE
SUITE 1000
TAMPA, FLORIDA 33607
April 14, 2000
Dear Stockholder:
You are cordially invited to attend the 2000 Annual Meeting of
Stockholders (the "Meeting") of Coast Dental Services, Inc. (the "Company"). The
Meeting will be held May 12, 2000 at 10:00 a.m., Eastern Daylight Savings Time,
at the Hyatt Regency Westshore, located at 6200 Courtney Campbell Causeway,
Tampa, Florida 33607.
The Notice of the Meeting and the Proxy Statement on the following
pages cover the formal business of the Meeting, which includes the election of
three Directors and a proposal to ratify the appointment of the Company's
independent certified public accountants. We will report on the progress of the
Company and comment on matters of current interest.
It is important that your shares be represented at the Meeting. We ask
that you promptly sign, date and return the enclosed proxy card in the envelope
provided, even if you plan to attend the Meeting. Returning your proxy card to
us will not prevent you from voting in person at the Meeting if you are present
and choose to do so.
If your shares are held in street name by a brokerage firm, your broker
will supply you with a proxy to be returned to the brokerage firm. It is
important that you return the form to the brokerage firm as quickly as possible
so that the brokerage firm may vote your shares. You may not vote your shares in
person at the Meeting unless you obtain a power of attorney or legal proxy from
your broker authorizing you to vote the shares, and you present this power of
attorney or proxy at the Meeting.
Your Board of Directors and management look forward to greeting you
personally at the Meeting.
Sincerely,
/s/ Dr. Terek Diasti
--------------------------------------------------
DR. TEREK DIASTI
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
<PAGE> 3
COAST DENTAL
COAST DENTAL SERVICES, INC.
2502 NORTH ROCKY POINT DRIVE
SUITE 1000
TAMPA, FLORIDA 33607
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
FRIDAY, MAY 12, 2000
Notice is hereby given that the Annual Meeting of stockholders of Coast
Dental Services, Inc. (the "Company"), a Delaware corporation, will be held at
the Hyatt Regency Westshore, located at 6200 Courtney Campbell Causeway, Tampa,
Florida 33607, on May 12, 2000, at 10:00 a.m., Eastern Daylight Savings Time
(the "Meeting") for the following purposes:
1. To re-elect three Directors to serve until the Annual Meeting in
2003 and until their successors are elected and qualified or until
their earlier resignation, removal from office or death;
2. To ratify the appointment of Deloitte & Touche, LLP as the Company's
independent auditors for fiscal year 2000; and
3. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
Your attention is directed to the Proxy Statement accompanying this
Notice for a more complete description of the matters to be acted upon at the
Meeting. The 1999 Annual Report of the Company is also enclosed. Stockholders of
record at the close of business on Monday, April 3, 2000 are entitled to receive
notice of and to vote at the Meeting and any adjournment thereof.
All stockholders are cordially invited to attend the Meeting. Whether
or not you expect to attend, please sign and return the enclosed Proxy promptly
in the envelope provided to assure the presence of a quorum. You may revoke your
Proxy and vote in person at the Meeting, if you so desire. If your shares are
held in street name by a brokerage firm, your broker will supply you with a
proxy to be returned to the brokerage firm. It is important that you return the
form to the brokerage firm as quickly as possible so that the brokerage firm may
vote your shares. You may not vote your shares in person at the Meeting unless
you obtain a power of attorney or legal proxy from your broker authorizing you
to vote the shares, and you present this power of attorney or proxy at the
Meeting.
Please note that attendance at the Meeting will be limited to
stockholders of the Company as of the record date (or their duly authorized
representatives). If your shares are held by a bank or broker, please bring to
the Meeting your bank or brokerage statement evidencing your beneficial
ownership of the Company stock.
By Order of the Board of Directors,
/s/ William H. Geary, III
-------------------------------------
WILLIAM H. GEARY, III
Secretary
Tampa, Florida
April 14, 2000
<PAGE> 4
COAST DENTAL SERVICES, INC.
2502 NORTH ROCKY POINT DRIVE
SUITE 1000
TAMPA, FLORIDA 33607
PROXY STATEMENT
This Proxy Statement is furnished by the Board of Directors and
management of Coast Dental Services, Inc. (the "Company") in connection with the
solicitation of proxies to be voted at the Company's 2000 Annual Meeting of
Stockholders (the "Meeting"), which will be held at 10:00 a.m., Eastern Daylight
Savings Time on Friday, May 12, 2000 at the Hyatt Regency Westshore, 6200
Courtney Campbell Causeway, Tampa, Florida 33607.
Any proxy delivered pursuant to this solicitation may be revoked, at
the option of the person executing the proxy, at any time before it is exercised
by delivering a signed revocation to the Company, by submitting a later-dated
proxy, or by attending the Meeting in person and casting a ballot. If proxies
are signed and returned without voting instructions, the shares represented by
the proxies will be voted as recommended by the Board of Directors.
The cost of soliciting proxies will be borne by the Company. In
addition to the use of the mails, proxies may be solicited personally or by
telephone by regular employees of the Company. The Company does not expect to
pay any compensation for the solicitation of proxies, but may reimburse brokers
and other persons holding stock in their names, or in the names of nominees, for
their expense in sending proxy materials to their principals and obtaining their
proxies. The approximate date on which this Proxy Statement and enclosed form of
proxy has been first mailed to stockholders is April 14, 2000.
The close of business on Monday, April 3, 2000, has been designated as
the record date for the determination of stockholders entitled to receive notice
of and to vote at the Meeting (the "Stockholders"). As of March 31, 2000,
6,403,683 shares of the Company's Common Stock, par value $.001 per share, were
issued and outstanding. Each Stockholder will be entitled to one vote for each
share of Common Stock registered in his or her name on the books of the Company
as of the close of business on Monday, April 3, 2000, on all matters that come
before the Meeting.
1. RE-ELECTION OF DIRECTORS
There are currently five seats on the Board of Directors of the
Company, with one vacancy. The Board is divided into three classes of Directors
serving staggered three-year terms. Directors hold their positions until the
annual meeting of stockholders in the year in which their term expires and until
their respective successors are elected and qualified or until their earlier
resignation, removal from office or death. The term of office of three of the
Company's current four Directors, Terek Diasti, John H. Kang and Donald R.
Millard, will expire at the Meeting. The Board of Directors recommends that
these Directors be re-elected at the Meeting to hold office until the Company's
annual meeting in 2003 and until their successors shall be duly elected and
qualified or until their earlier resignation, removal from office or death.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE
RE-ELECTION OF TEREK DIASTI AS DIRECTOR, TO SERVE THE TERM DESCRIBED ABOVE. For
further information on Dr. Diasti see "Management - Directors and Executive
Officers" and "Security Ownership of Management and Others". Stockholders may
vote for Dr. Diasti and the affirmative vote of holders of a majority of the
shares represented, in person or by proxy, and entitled to vote at the Meeting
is required to re-elect Dr. Diasti. Abstentions will be counted toward the
number of shares represented at the Meeting. Broker non-votes will be
disregarded. Stockholders may not vote cumulatively in the election of
Directors. In the event Dr. Diasti should be unable to serve, which is not
anticipated, the proxy committee, which consists of Dr. Terek Diasti, will vote
for such other person or persons for the office of Director as the Board of
Directors may recommend.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE
RE-ELECTION OF JOHN H. KANG AS DIRECTOR, TO SERVE THE TERM DESCRIBED ABOVE. For
further information on Mr. Kang see "Management - Directors and Executive
Officers" and "Security Ownership of Management and Others". Stockholders may
vote for Mr. Kang and the affirmative vote of holders of a majority of the
shares represented, in person or by proxy, and entitled to vote at the Meeting
is required to re-elect Mr. Kang. Abstentions will be counted toward the number
of shares represented at the Meeting. Broker non-votes will be disregarded.
Stockholders may not vote cumulatively in the election of Directors. In the
event Mr. Kang should be unable to serve, which is not anticipated, the proxy
committee, which consists of Dr. Terek Diasti, will vote for such other person
or persons for the office of Director as the Board of Directors may recommend.
<PAGE> 5
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE
RE-ELECTION OF DONALD R. MILLARD AS DIRECTOR, TO SERVE THE TERM DESCRIBED ABOVE.
For further information on Mr. Millard see "Management - Directors and Executive
Officers" and "Security Ownership of Management and Others". Stockholders may
vote for Mr. Millard and the affirmative vote of holders of a majority of the
shares represented, in person or by proxy, and entitled to vote at the Meeting
is required to re-elect Mr. Millard. Abstentions will be counted toward the
number of shares represented at the Meeting. Broker non-votes will be
disregarded. Stockholders may not vote cumulatively in the election of
Directors. In the event Mr. Millard should be unable to serve, which is not
anticipated, the proxy committee, which consists of Dr. Terek Diasti, will vote
for such other person or persons for the office of Director as the Board of
Directors may recommend.
MANAGEMENT - DIRECTORS AND EXECUTIVE OFFICERS
INFORMATION REGARDING OUTSIDE DIRECTORS:
JOHN H. KANG, age 37 has been a Director and a member of the Audit and
Compensation Committee since the Company's initial public offering on February
11, 1997. Mr. Kang's term as Director expires this year and Mr. Kang is a
nominee listed for re-election at the 2000 Annual Meeting of Stockholders. Mr.
Kang has been President and a Director of Medical Manager Corporation, a
publicly owned company, since July 1996. He is the founder of NMS and has served
as its President since its inception in 1994. In 1987, Mr. Kang founded J.
Holdsworth Capital Ltd., a private investment firm, and is currently President.
He has been a Director of Amorphous Technologies International, a company
engaged in the research and development and manufacture of metal alloy, since
May 1995. Mr. Kang also has been a Director of Nutcracker Snacks, Inc., a
manufacturer of snack foods, since December 1988. From June 1988 to September
1996, Mr. Kang was the Chairman and a director of Clayton Group, Inc., a
distributor of waterworks materials. Mr. Kang received his B.A. in Economics
from Harvard College in 1985.
DONALD R. MILLARD, age 52, has been a Director and a member of the
Audit and Compensation Committee of the Company since the Company's initial
public offering on February 11, 1997. Mr. Millard's term as Director expires
this year and Mr. Millard is a nominee listed for re-election at the 2000 Annual
Meeting of Stockholders. Mr. Millard is currently the Chief Executive Officer
and President of Matria Healthcare, Inc., a publicly owned company, that is the
leading provider of comprehensive obstetrical home care and maternity management
services. Mr. Millard has also served as Senior Vice President of Finance and
Chief Financial Officer as well as Treasurer of Matria Healthcare, Inc.
Previously, Mr. Millard served as Vice President - Finance and Chief Financial
Officer of Healthdyne, Inc., from 1987 and, in addition, was elected Treasurer
in March 1990 and served in such capacities until Healthdyne, Inc. consummated a
merger in 1996 with Tokos Medical Corporation to form Matria Healthcare, Inc.
Mr. Millard, a Certified Public Accountant, received a Bachelor of Business
Administration in Accounting from the University of Georgia in 1969.
INFORMATION REGARDING INSIDE DIRECTORS AND EXECUTIVE OFFICERS:
DR. TEREK DIASTI, DVM, CHIEF EXECUTIVE OFFICER, CHAIRMAN OF THE BOARD
OF DIRECTORS, age 41. Dr. Diasti is a founder of the Company and has served as
Chairman of the Board of the Company since 1992. Dr. Diasti's term as Director
expires this year and Dr. Diasti is a nominee listed for re-election at the 2000
Annual Meeting of Stockholders. From 1989 to 1993, Dr. Diasti operated and
managed Lakeside Animal Hospital, Avalon Animal Hospital, Country Oaks Animal
Hospital and Northdale Animal Hospital, all of which are veterinary hospitals in
Tampa, Florida. While at the veterinary hospitals, Dr. Diasti was engaged in the
development, internal managerial and operational programs. Dr. Diasti received
his Doctorate of Veterinary Medicine from Purdue University.
DR. ADAM DIASTI, DDS, PRESIDENT, DENTAL DIRECTOR AND DIRECTOR, age 39.
Dr. Diasti is a founder of the Company and has served as the President of the
Company since its inception. Dr. Diasti's term as Director expires during the
year 2001. Dr. Diasti is also the founder, President, director and sole
stockholder of Coast Florida, P.A., Coast Dental Services, P.A., Coast Dental of
Georgia, P.C. and Coast Dental Services of Tennessee, P.C. (collectively, the
"Coast P.A.") From May 1991 to May 1992, he managed and operated the Sarasota
Walk-In Dental Clinic, a group practice of three dentists and denture laboratory
in Sarasota, Florida. Prior to May 1991, Dr. Diasti worked as a dentist in a
large group practice of 18 offices known as Quality Dental in Newman Grove,
Nebraska. He served as the Dental Operations Manager of Quality Dental. Dr.
Diasti has a Doctorate of Dental Surgery from Creighton University in 1990 and
is a member of the American Dental Association.
2
<PAGE> 6
WILLIAM H. GEARY, III, CHIEF FINANCIAL OFFICER, age 37. Mr. Geary
joined the Company in October 1997 and served as its Controller until his
appointment as Chief Financial Officer in October 1999. From October 1991 to
October 1997, Mr. Geary served as Divisional Vice President and Controller for
Beall's, Inc., an operator of approximately 200 department and outlet stores in
three states. From 1984 to 1991, Mr. Geary served in the audit department of
Deloitte & Touche, LLP. Mr. Geary has a Bachelor of Science in Accounting from
the University of South Florida and is a Certified Public Accountant.
RONN S. KELLY, CHIEF OPERATING OFFICER, age 41. Mr. Kelly joined the
Company in March 1999. From 1997 to 1999, Mr. Kelly served as Senior Vice
President of Operations for Professional Dental Associates, Inc., ("PDA"), a
dental practice management company which managed approximately 160 dentists.
From 1995 through 1997, Mr. Kelly served as Regional Vice President of
Operations for MedPartners, Inc., a physician practice management company which
managed over 12,000 multi-specialty physicians throughout the United States. Mr.
Kelly received a Bachelor of Science in Business Management in 1981 from
Southern College.
CHRIS SALEMI, VICE PRESIDENT OF REAL ESTATE, age 39. Mr. Salemi joined
the Company in September 1997 and served as its Director of Real Estate
Administration until his appointment as Vice President of Real Estate in 1999.
Prior to joining the Company, Mr. Salemi served as Director of Real Estate
Administration and Property Management for Eckerd Corporation, an operator of
approximately 2,800 drug stores in 26 states. Mr. Salemi has a Bachelor of Arts
in Accounting from the University of South Florida and is a Certified Public
Accountant.
KEY RELATIONSHIPS
A family relationship exists between Terek and Adam Diasti, who are
brothers, as well as executive officers and Directors of the Company. Terek
Diasti is a nominee listed for re-election as a Director at the 2000 Annual
Meeting of Stockholders.
BOARD OF DIRECTORS
The Board of Directors of the Company held two formal meetings, with
100% Director attendance, during 1999. The entire Board of Directors functions
as a Nominating Committee for recommending to stockholders candidates for
positions on the Board of Directors and the Board will consider written
recommendations from stockholders for nominations to the Board of Directors in
accordance with the procedures set forth in the By-Laws of the Company.
AUDIT COMMITTEE
The Audit Committee, consisting of Messrs. John H. Kang and Donald R.
Millard with one vacancy, is authorized to recommend to the Board independent
certified public accounting firms for selection as auditors of the Company; make
recommendations to the Board on auditing matters; examine and make
recommendations to the Board concerning the scope of audits; and review and
approve the terms of transactions between the Company and related party
entities. During 1999, the Audit Committee met two times with 100% member
attendance. The Company retained Deloitte & Touche, LLP to conduct the audit for
the year ended December 31, 1999.
COMPENSATION COMMITTEE
The Compensation Committee, consisting of Messrs. Terek Diasti, John H.
Kang and Donald R. Millard, is authorized to exercise all of the powers of the
Board of Directors with respect to matters pertaining to compensation and
benefits, including, but not limited to, salary matters, incentive/bonus plans,
stock option plans, investment programs and insurance plans, and the Committee
is authorized to exercise all of the powers of the Board in matters pertaining
to employee promotions and the designation and/or revision of employee positions
and job titles. The Compensation/Benefits Committee met once during 1999 with
100% member attendance.
See "Certain Transactions" for additional information on certain members of
management.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, officers and stockholders of more than 10% of the Company's
Common Stock to file with the Securities and Exchange Commission initial reports
of ownership and reports of changes in ownership of Common Stock and any other
equity securities of the Company. To the Company's knowledge, based solely upon
a review of forms, reports and certificates furnished to the Company by such
persons, all such reports were filed on a timely basis except Ronn Kelly who
inadvertently filed his Form 3 one year late and Chris Salemi who inadvertently
filed his Form 3 four months late.
3
<PAGE> 7
SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS
The following table sets forth, as of March 31, 2000, information as to
the beneficial ownership of the Company's Common Stock by (i) each person known
to the Company as having beneficial ownership of more than 5% of the Company's
Common Stock, (ii) each person serving the Company as Director on such date and
each nominee for Director, (iii) each person serving the Company as executive
officer on such date who qualifies as a "named executive officer" as defined in
Item 402(a)(3) of Regulation S-K under the Securities Exchange Act of 1934 and
(iv) all of the Directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF SHARES PERCENT OF
STOCKHOLDERS(1) BENEFICIALLY OWNED CLASS(2)
--------------- --------------------------- --------
<S> <C> <C>
Diasti Nevada Family Limited Partnership(3)............... 2,555,000 39.9%
Terek Diasti(3)........................................... 2,555,000 39.9
Adam Diasti(3)............................................ 2,555,000 39.9
Tim Diasti(3)............................................. 2,555,000 39.9
William H. Geary, III(4).................................. 10,370 *
John H. Kang(5)........................................... 85,833 1.3
Ronn S. Kelly(6).......................................... 16,666 *
Donald R. Millard(5)...................................... 3,333 *
Chris D. Salemi(7)........................................ 9,314 *
All directors and executive officers as a group
(7 persons)............................................ 2,680,516 42.0%
</TABLE>
* Less than one percent
(1) Unless otherwise indicated, the address of each of the beneficial owners
identified is 2502 North Rocky Point Drive, Suite 1000, Tampa, Florida
33607.
(2) Based on 6,403,683 shares of Common Stock outstanding. Pursuant to the
rules of the Securities Exchange Commission, certain shares of Common Stock
which a person has the right to acquire within 60 days of the date hereof
pursuant to the exercise of stock options are deemed to be outstanding for
the purpose of computing the percentage ownership of such person but are
not deemed outstanding for the purpose of computing the percentage
ownership of any other person.
(3) Shares are owned by the Diasti Nevada Family Limited Partnership, 639
Isbell Road, Suite 390, Reno Nevada 89509, in which Dr. Terek Diasti, Dr.
Adam Diasti and Tim Diasti exercise equal investment and voting powers as
equal stockholders of the corporate general partner. Excludes 174,766
shares issuable upon the exercise of stock options held by the Coast P.A.
for the benefit of the Coast P.A. professionals. Adam Diasti is the sole
owner of the Coast P.A.
(4) Includes 8,870 shares issuable upon the exercise of stock options granted
pursuant to the Company's 1995 Stock Option Plan, which have vested and are
fully exercisable.
(5) Includes 3,333 shares each issuable upon the exercise of stock options
granted pursuant to the Company's 1995 Stock Option Plan, which have vested
and are fully exercisable.
(6) Includes 16,666 shares issuable upon the exercise of stock options granted
pursuant to the Company's 1995 Stock Option Plan, which have vested and are
fully exercisable.
(7) Includes 9,314 shares issuable upon the exercise of stock options granted
pursuant to the Company's 1995 Stock Option Plan, which have vested and are
fully exercisable.
EXECUTIVE COMPENSATION
COMPENSATION TO OUTSIDE DIRECTORS
The Company pays each director who is not an employee of the Company
("Outside Director") $1,000 for each Board of Directors meeting attended, plus
reimbursement for all reasonable expenses incurred by such director in
connection with such attendance at any meeting of the Board of Directors.
During 1997, the Company also granted options to purchase 4,000 shares
of Common Stock to each of the Outside Directors, of which 3,333 are vested, 667
vest on July 1, 2000 and are exercisable at the fair market value on the date of
grant at $8.00 for the February 11, 1997 grant and at $15.25 for the July 1,
1997 grant.
4
<PAGE> 8
EXECUTIVE COMPENSATION TABLES
The following tables provide information about executive compensation.
COMPENSATION SUMMARY TABLE
The following table sets forth the annual and long-term compensation
for services to the Company for the years ended December 31, 1997, 1998 and 1999
of those persons who were, at December 31, 1999, (i) the Chief Executive Officer
of the Company and (ii) the other four most highly compensated officers of the
Company whose compensation exceeded $100,000 for fiscal year ended 1999 (the
"Named Executive Officers").
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------ ------------------
SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY COMPENSATION STOCK OPTIONS COMPENSATION
- --------------------------- ---- ------ ------------ ------------- ------------
<S> <C> <C> <C> <C> <C>
Terek Diasti, Chief Executive Officer 1997 $100,000 -- -- --
1998 $200,000 -- -- --
1999 $215,000 -- -- --
Adam Diasti, President(1) 1997 $8,500 -- -- --
1998 $35,000 -- -- --
1999 $165,000 -- -- --
William H. Geary, III, Chief Financial Officer(2) 1997 $14,000 -- 6,000 --
1998 $85,000 -- 11,610 --
1999 $104,000 -- 30,000 --
Ronn S. Kelly, Chief Operating Officer(3) 1999 $119,000 $ 25,000 55,000 --
Chris D. Salemi, Vice President of Real Estate(2) 1997 $26,000 -- 6,667 --
1998 $89,000 -- 11,610 --
1999 $110,000 -- 30,000 --
Joseph R. Smith, Former Chief Financial 1997 $165,000 -- 13,279 --
Officer(4) 1998 $180,000 -- 18,230 --
1999 $138,500 -- -- $ 41,500
</TABLE>
(1) Dr. Adam Diasti, because of his obligations to the Coast P.A., agreed to
devote such time and attention as was reasonably necessary to fulfill his
contractual obligations to the Company. During 1997 and 1998, Dr. Diasti
devoted the majority of his time and attention to the Coast P.A. and as
such, the Company incurred only a percentage of his contractual
compensation. However, in 1999, Dr. Diasti devoted the majority of his time
and attention to the Company, and therefore both parties agreed, Dr.
Diasti's contractual compensation would be incurred solely by the Company.
(2) The salary paid to Mr. Geary and Mr. Salemi in 1997 represents compensation
to Mr. Geary and Mr. Salemi, respectively for the portion of the year they
were employed by the Company.
(3) Mr. Ronn Kelly joined the Company on March 22, 1999. Pursuant to the terms
of his Employment Agreement, Mr. Kelly received $25,000 from the Company to
assist with his relocation. The Company reimbursed Mr. Kelly for those
relocation expenses upon presentation of an itemized account of such
expenditures.
(4) Mr. Joseph Smith resigned as Chief Financial Officer of the Company
effective October 1, 1999. The salary paid to Mr. Smith in 1999 represents
compensation to Mr. Smith for the portion of the year he was employed by
the Company. Pursuant to the terms of his Severance Agreement, Mr. Smith
received a total of $41,500 through December 31, 1999 and will continue to
receive severance in the aggregate of $48,500 from January 1, 2000 through
June 30, 2000 for a total severance amount of $90,000.
5
<PAGE> 9
OPTION/SAR GRANTS IN LAST FISCAL YEAR 1999
The following table shows all grants of stock options to the Company's
Named Executive Officers during 1999. The options were granted under the
Company's Employee Stock Option Plan. In addition, no grants of stock
appreciation rights (SARS) were made by the Company in fiscal year 1999. Each
option granted may be exercised with respect to one-third of the aggregate
number of shares subject to the grant each year, commencing one year after the
date of grant. Pursuant to the Securities Exchange Commission rules, the table
also shows the value of the options granted at the end of the option terms (ten
years) if the stock price were to appreciate annually by 5% and 10%,
respectively. There is no assurance that the stock price will appreciate at the
rates shown in the table. The table also indicates that if the stock price does
not appreciate, the potential realizable value of the options granted will be
zero.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES
OF STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM
----------------------------------------------------------- ---------------------------------
PERCENT OF
NUMBER OF TOTAL OPTIONS EXERCISE
SECURITIES GRANTED TO OR BASE
UNDERLYING EMPLOYEES IN PRICE EXPIRATION
NAME OPTIONS GRANTED FISCAL YEAR ($/SH) DATE 0% 5% 10%
- ---- ---------------- ----------- ------ ---- -- -- ---
<S> <C> <C> <C> <C> <C> <C> <C>
William H. Geary, III 25,000 14.0% 4.719 07/01/09 0 $ 192,169 $ 305,997
5,000 2.0 4.500 09/01/09 0 8,152 12,980
Ronn S. Kelly 50,000 27.0 6.031 03/18/09 0 491,193 782,143
5,000 2.0 4.500 09/01/09 0 8,152 12,980
Chris D. Salemi 25,000 14.0 4.719 07/01/09 0 192,169 305,997
5,000 2.0 4.500 09/01/09 0 8,152 12,980
</TABLE>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION/SAR VALUES
The following table provides information as to options exercised by
each of the named executive officers of the Company during 1999. The table sets
forth the value of options held by such officers at year end measured in terms
of the closing price of the Company's Common Stock on December 31, 1999.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT FISCAL YEAR END FISCAL YEAR END
------------------------------- -------------------------------
SHARES ACQUIRED VALUE
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
William H. Geary, III 0 $0 7,870 39,740 $0 $0
Ronn S. Kelly 0 $0 0 55,000 $0 $0
Chris Salemi 0 $0 8,314 39,963 $0 $0
</TABLE>
6
<PAGE> 10
EMPLOYMENT AGREEMENTS
The Company and Dr. Terek Diasti are parties to an Employment Agreement
(the "Terek Diasti Employment Agreement"), pursuant to which Dr. Terek Diasti
has agreed to serve as the Chief Executive Officer of the Company. The term of
the Terek Diasti Employment Agreement is for five years ending September 31,
2001 and is renewable for subsequent one year terms by mutual agreement of the
parties. Dr. Terek Diasti received an annual base salary of $110,000 during the
first year of the Terek Diasti Employment Agreement and will receive not less
than $135,000 for subsequent years under the Terek Diasti Employment Agreement.
Dr. Terek Diasti has agreed to devote substantially all of his time and
attention to the business and affairs of the Company. Dr. Terek Diasti will be
eligible for an annual incentive bonus, up to 100% of his annual base salary, in
an amount to be determined by the Compensation Committee of the Board of
Directors in accordance with the Company achieving certain performance measures
set by the Compensation Committee. Dr. Terek Diasti is also eligible for
inclusion in any health, medical, disability, insurance or pension plan made
available by the Company to its employees, a portion of which will be at the
Company's expense. The Terek Diasti Employment Agreement provides that in the
event of a termination of employment by the Company other than (i) for cause,
(ii) upon death or disability or (iii) upon voluntary termination by employee,
such employee shall be entitled to receive from the Company a series of monthly
payments equal to one-twelfth of the employee's annual base salary for each
month during the remaining term of the Terek Diasti Employment Agreement, but
not less than 24 months, plus a payment for accrued but unpaid wages and expense
reimbursements. The Terek Diasti Employment Agreement provides that in the event
such employee's employment terminates other than for cause within twelve months
following a change in control (as defined in the Terek Diasti Employment
Agreement) of the Company, the Company shall pay such employee a series of 36
monthly payments of one-twelfth of the sum of such employee's base salary plus
his previous years' bonus. The Terek Diasti Employment Agreement contains a
non-competition covenant with the Company for a period of two years following
termination of employment.
The Company and Dr. Adam Diasti are parties to an Employment Agreement
(the "Adam Diasti Employment Agreement"), pursuant to which he has agreed to
serve as the President of the Company. The term of the Adam Diasti Employment
Agreement is for five years ending September 31, 2001 and is renewable for
subsequent one year terms by mutual agreement of the parties. Dr. Adam Diasti
received an annual base salary of $90,000 during the first year of the Adam
Diasti Employment Agreement and will receive not less than $115,000 for
subsequent years under the Adam Diasti Employment Agreement. Dr. Adam Diasti has
agreed to devote substantially all of his time and attention to the business and
affairs of the Company. Dr. Adam Diasti will be eligible for an annual incentive
bonus, up to 100% of his annual base salary, in an amount to be determined by
the Compensation Committee of the Board of Directors in accordance with the
Company achieving certain performance measures set by the Compensation
Committee. Dr. Adam Diasti is also eligible for inclusion in any health,
medical, disability, insurance or pension plan made available by the Company to
its employees, a portion of which will be at the Company's expense. The Adam
Diasti Employment Agreement provides that in the event of a termination of
employment by the Company other than (i) for cause, (ii) upon death or
disability or (iii) upon voluntary termination by employee, such employee shall
be entitled to receive from the Company a series of monthly payments equal to
one-twelfth of the employee's annual base salary for each month during the
remaining term of the Adam Diasti Employment Agreement, but not less than 24
months, plus a payment for accrued but unpaid wages and expense reimbursements.
The Adam Diasti Employment Agreement provides that in the event such employee's
employment terminates other than for cause within twelve months following a
change in control (as defined in the Adam Diasti Employment Agreement) of the
Company, the Company shall pay such employee a series of 36 monthly payments of
one-twelfth of the sum of such employee's base salary plus his previous years'
bonus. The Adam Diasti Employment Agreement contains a non-competition covenant
with the Company for a period of two years following termination of employment.
The Company and William H. Geary, III are parties to an Employment
Agreement (the "Geary Employment Agreement"), pursuant to which Mr. Geary has
agreed to serve as Chief Financial Officer of the Company. The term of the Geary
Employment Agreement is for three years ending on October 21, 2002, and is
renewable for subsequent one year terms by mutual agreement of the parties. The
Geary Employment Agreement provides that Mr. Geary will devote his full time to
the business and affairs of the Company and will receive an annual base salary
at an initial rate equal to $150,000. Mr. Geary is also eligible for inclusion
in any health, medical, disability, insurance or pension plan made available by
the Company to its employees, a portion of which will be at the Company's
expense. The Geary Employment Agreement terminates automatically upon death or
disability of Mr. Geary and is terminable by the Company "for cause" as defined
in the Employment Agreement. The Geary Employment Agreement contains a
non-competition covenant with the Company for a period of eighteen months
following termination of employment.
7
<PAGE> 11
The Company and Ronn S. Kelly are parties to an Employment Agreement
(the "Kelly Employment Agreement"), pursuant to which Mr. Kelly has agreed to
serve as Chief Operating Officer of the Company. The term of the Kelly
Employment Agreement is for four years ending on March 22, 2003, and is
renewable for subsequent one year terms by mutual agreement of the parties. The
Kelly Employment Agreement provides that Mr. Kelly will devote his full time to
the business and affairs of the Company and will receive an annual base salary
at an initial rate equal to $150,000. Mr. Kelly will be eligible for an annual
incentive bonus, up to 20% of his annual base salary, in an amount to be
determined by the Compensation Committee of the Board of Directors in accordance
with the Company achieving certain performance measures as defined in the Kelly
Employment Agreement. In addition, Mr. Kelly received, under the Kelly
Employment Agreement, 50,000 shares of the Company's common stock pursuant to
the Company's 1995 Stock Option Plan, with options to vest in a series of three
equal installments with the third and final installment vesting on the third
anniversary of the grant date. Mr. Kelly also received a one time payment of
$25,000 for reimbursement of his relocation expenses. Mr. Kelly is also eligible
for inclusion in any health, medical, disability, insurance or pension plan made
available by the Company to its employees, a portion of which will be at the
Company's expense. The Kelly Employment Agreement terminates automatically upon
death or disability of Mr. Kelly and is terminable by the Company "for cause" as
defined in the Kelly Employment Agreement. The Kelly Employment Agreement
contains a non-competition covenant with the Company for a period of eighteen
months following termination of employment.
The Company and Chris D. Salemi are parties to an Employment Agreement
(the "Salemi Employment Agreement"), pursuant to which Mr. Salemi has agreed to
serve as Vice President of Real Estate of the Company. The term of the Salemi
Employment Agreement is for three years ending on October 21, 2002, and is
renewable for subsequent one year terms by mutual agreement of the parties. The
Salemi Employment Agreement provides that Mr. Salemi will devote his full time
to the business and affairs of the Company and will receive an annual base
salary at a rate equal to $125,000. Mr. Salemi is also eligible for inclusion in
any health, medical, disability, insurance or pension plan made available by the
Company to its employees, a portion of which will be at the Company's expense.
The Salemi Employment Agreement terminates automatically upon death or
disability of Mr. Salemi and is terminable by the Company "for cause" as defined
in the Salemi Employment Agreement. The Salemi Employment Agreement contains a
non-competition covenant with the Company for a period of eighteen months
following termination of employment.
8
<PAGE> 12
THE INFORMATION CONTAINED IN THE FOLLOWING SECTIONS ENTITLED "REPORT OF
THE COMPENSATION COMMITTEE" AND "PERFORMANCE GRAPH" ARE NOT DEEMED TO BE
"SOLICITING MATERIAL" OR TO BE "FILED" WITH THE SECURITIES EXCHANGE COMMISSION
OR SUBJECT TO REGULATION A UNDER THE SECURITIES ACT OF 1933, OR TO THE
LIABILITIES OF SECTION 18 OF THE SECURITIES EXCHANGE ACT OF 1934.
REPORT OF THE COMPENSATION COMMITTEE
The following report was prepared as of the date of this proxy
statement by Directors Dr. Terek Diasti, John H. Kang and Donald R. Millard, as
members of the Company's Compensation Committee.
The Compensation Committee acts on behalf of the Board of
Directors to establish the general compensation policy of the Company
for all employees of the Company and to determine the compensation for
the Chief Executive Officer and other executive officers. It also
administers the Company's stock plans. Additionally, the Compensation
Committee is routinely consulted to approve compensation packages for
newly-hired executives. The Compensation Committee's compensation
policy for executive officers is designed to promote continued
performance, and attract, motivate and retain talented executives
responsible for the success of the Company.
Annual compensation for all the executive officers of the
Company will be determined by the Compensation Committee of the
Company, subject to terms of any applicable employment agreement
negotiated between an officer and the Company. The Compensation
Committee determines the compensation levels for the executive officers
based upon several considerations, including the growth and earnings of
the Company, individual performance, and general economic conditions,
including but not limited to increases in the cost of living. Increases
in compensation in subsequent years will be discretionary and based
upon the foregoing factors. The Compensation Committee is not expected
to give particular weight to a specific factor or use a formula in
determining compensation.
Long-term equity incentives for executive officers and other
Company employees are effected through stock option grants under the
Company's 1995 Stock Option Plan. The Compensation Committee believes
that equity-based compensation in the form of stock options links the
interests of management and employees with those of the stockholders.
Stock options only have value if the stock price appreciates in value
from the date the options are granted. The number of stock options
granted to executive officers is within the discretion of the
Compensation Committee and is based on each executive's position within
the Company, past performance, anticipated future contributions, and
prior option grants. During 1999, the Compensation Committee approved a
grant of stock options to the Chief Financial Officer, the Chief
Operating Officer and the Vice President of Real Estate. Stock options
have also been provided to the President's professional associations.
The Chief Executive Officer has not previously received stock options
due to his substantial equity holdings in the Company. Notwithstanding
the foregoing, and due to the Compensation Committee's policy of
linking executive compensation to equity-based compensation in the form
of stock options, the Compensation Committee expects to make stock
option awards to the Chief Executive Officer in the future.
Respectfully submitted,
The Compensation Committee
DR. TEREK DIASTI
JOHN H. KANG
DONALD R. MILLARD
9
<PAGE> 13
PERFORMANCE GRAPH
Rules promulgated by the SEC require that the Company include in this
Proxy Statement a line graph which compares the yearly percentage change over
the past five years in cumulative total stockholder return on the Common Stock
with (i) the performance of a broad equity market index, and (ii) the
performance of a published industry index or peer group index. As the Company
did not consummate its initial public offering until February 11, 1997, there
was no active public market for the Company's Common Stock prior to that time.
On February 11, 1997, the opening price per share of the Company's Common Stock
was $8.00 and on such date the price closed at $10.50 per share. Accordingly,
the following graph compares the percentage change in the return on the Common
Stock for the period from February 11, 1997 to December 31, 1999 with the
cumulative total return on the Center for Research in Security Prices ("CRSP")
Index for the Nasdaq Stock market (U.S. Companies) and the CRSP Index for Health
Services for the same period. The graph assumes the investment of $100 on
February 11, 1997 and the reinvestment of any dividends.
COMPARISON OF CUMULATIVE TOTAL RETURN
FOR THE PERIOD FEBRUARY 11, 1997 TO DECEMBER 31, 1999
AMONG COAST DENTAL SERVICES, INC., CRSP NASDAQ U.S. INDEX AND
CRSP HEALTH SERVICES INDEX
Prepared by the Center for Research in Security Prices
Produced on 03/13/2000 including data to 12/31/1999
<TABLE>
<CAPTION>
02/1997 12/1997 12/1998 12/1999
------- ------- ------- -------
<S> <C> <C> <C> <C>
Coast Dental Services, Inc. 100.0 228.6 98.8 23.2
Nasdaq Stock Market (US Companies) 100.0 118.8 167.4 304.3
Nasdaq Health Services Stocks 100.0 101.6 86.1 69.8
</TABLE>
Note: The stock price performance graph shown on the graph above is not
necessarily indicative of future price performance.
10
<PAGE> 14
CERTAIN TRANSACTIONS
The information set forth herein briefly describes certain
relationships and related transactions since the beginning of the Company's last
fiscal year between the Company and its Directors, officers and stockholders
owning 5% or more of the Company's Common Stock. These relationships and
transactions have been and will continue to be approved by a majority of the
Company's independent Directors of the Audit Committee and will be on terms no
less favorable to the Company than those that could be obtained from
unaffiliated parties.
AGREEMENT WITH COAST P.A.
The Company has agreements to provide dental management, services and
support to each Coast P.A. ("Services and Support Agreements"). Dr. Adam Diasti,
a Director and the President of the Company, is the sole owner of the Coast P.A.
Payments made by the Coast P.A. to the Company for management services were
approximately $44.6 million for the year ended December 31, 1999. The service
and support fees paid to the Company by the Coast P.A. have historically ranged
from 65% to 76% of the gross revenue, net of refunds and discounts, of the
dental offices managed by the Company pursuant to the Services and Support
Agreements (the "Dental Centers"). The services and support fees between the
parties may be revised from time to time based upon negotiations between the
Audit Committee and the Coast P.A. The Company pays, out of the services and
support fee, all of the operating and non-operating expenses incurred by the
Coast P.A. at the Dental Centers, except for the salaries and benefits of the
Coast P.A. dentists and dental hygienists. For the period June 1, 1997 through
January 31, 1999, the Company paid the Coast P.A. the sum of $50,000 in
connection with each internally developed Dental Center it committed to open, in
consideration for the Coast P.A.'s agreement to expand the Services and Support
Agreements to include the new internally developed Dental Centers. Effective
February 1, 1999, the Services and Support Agreements were modified to
discontinue the payment of this fee, and the services and support fees were
adjusted to 73% of the Dental Centers' gross revenue. Due to this amendment to
the Services and Support Agreements, no $50,000 fees were paid to the Coast P.A.
in 1999 for internally developed Dental Centers. The Audit Committee approved a
further adjustment to the services and support fees beginning in January 2000,
to 67% in connection with the Coast P.A.'s anticipated roll out of a new
compensation plan for Coast P.A. dentists, which will be staged throughout the
year. As a result of the adjustment, the service and support fees are expected
to average between 66% and 72% over the next several years.
ACQUISITIONS WITH COAST P.A.
The Company and the Coast P.A. periodically have jointly entered into
asset purchase agreements with existing dental practices. In all cases, the
Coast P.A. acquires the patient lists and any other professional assets and the
Company acquires certain tangible assets, principally the dental equipment, and
assumes certain liabilities such as the lease agreement for the facility. During
1999, the Company and the Coast P.A. added 11 acquired Dental Centers located in
Virginia. The Company's portion of the purchase price for these 11 acquired
Dental Centers was $2.1 million, consisting primarily of $1.2 million in cash
and $0.9 million in promissory notes and certain assumed liabilities.
AGREEMENT WITH DR. ADAM DIASTI
The Company has an agreement with Dr. Adam Diasti, pursuant to which
Dr. Diasti has agreed to sell all of his shares of Coast P.A. stock to a
licensed dentist designated by the Company if certain events occur. Dr. Diasti
is a Director and President of the Company. The purchase price under the
agreement, if the certain event should occur, will be the fair market value of
Dr. Diasti's shares of the Coast P.A.'s stock.
LOANS TO COAST P.A.
The Coast P.A. is indebted to the Company in the aggregate amount as of
December 31, 1999 of approximately $10.4 million which represents services and
support fees payable to the Company in accordance with the Services and Support
Agreements.
11
<PAGE> 15
ACQUISITION OF MID-COAST DENTAL SERVICES
On March 6, 1998, the Company announced that it had reached an
agreement with Mid-Coast Dental Services, Inc., a Virginia corporation ("MCDS"),
to provide financing for the development of Dental Centers in Virginia. The
Company utilized a small portion of its cash reserves to build, equip and lease
fully equipped Dental Centers to MCDS. The Company's loans to MCDS were on a
senior secured basis with interest and rentals providing income to the Company.
In exchange for providing financing for the building and acquisition of Dental
Centers, the Company received an option to acquire MCDS beginning on December
31, 1999. The purchase price under the option agreement was based on an agreed
upon formula which was expected to approximate the fair value of MCDS. Adam
Diasti, President of the Company, was a major stockholder of Adam Diasti,
D.D.S., Kurt M. Obeck, D.D.S. & Andrew S. Norman, D.D.S., P.C. n/k/a Adam
Diasti, D.D.S. & Associates, P.C., the professional corporation that employs
MCDS's doctors and hygienists. Effective April 1, 1999, the Company acquired
nine Dental Centers from MCDS. The purchase price for the nine acquired Dental
Centers in Virginia was $1.4 million, consisting of $0.8 million in cash and
$0.6 million in promissory notes and certain assumed liabilities.
2. RATIFICATION OF APPOINTMENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Deloitte & Touche, LLP was appointed as the Company's independent
auditors for the year 1999. The Board of Directors of the Company, upon the
recommendation of the Audit Committee, recommended that Deloitte & Touche, LLP
be retained as the Company's auditors for the year 2000. A representative of
Deloitte & Touche, LLP is expected to be present at the Meeting and will be
available to respond to questions and may make a statement if the representative
so desires.
3. OTHER BUSINESS
The Board of Directors knows of no other matters which are likely to be
brought before the Meeting. If any matter not described herein should be
presented for Stockholder action at the Meeting, the persons named in the
enclosed Proxy will vote the shares represented thereby in accordance with their
best judgment.
12
<PAGE> 16
STOCKHOLDER PROPOSALS FOR
PRESENTATION AT THE 2001 ANNUAL MEETING
Any stockholder intending to present a proposal at the 2001 Annual
Meeting in accordance with Rule 14a-8 under the Securities Exchange Act of 1934
for inclusion in the Company's proxy materials for such meeting must, in
addition to meeting other applicable requirements under the rules and
regulations of the Securities and Exchange Commission, submit such proposal to
William H. Geary, III, Secretary, in writing no later than December 14, 2000.
The Company's By-Laws require certain advance notice to the Company of a
stockholder sponsored proposal submitted outside the processes of Rule 14a-8,
including nominations by stockholders of persons to stand for election as
directors at stockholders' meetings. To be timely, such notice must be received
at the principal executive offices of the Company not less than 60 nor more than
90 days prior to the meeting of stockholders; provided, however, that in the
event that less than 70 days' notice or prior public disclosure of the date of
the meeting is given or made to the stockholders, notice by the stockholder in
order to be timely must be so received not later than the close of business on
the tenth day following the date on which such notice of the date of the annual
meeting was mailed or public disclosure of the date of the annual meeting was
made, whichever first occurs. A proposal submitted outside the processes of Rule
14a-8 is any stockholder proposal submitted for presentation at the 2001 Annual
Meeting but not submitted for inclusion in the Company's proxy statement. Under
Rule 14a-4(c)(1), if a proponent fails to notify the Company by the advance
notice date, then the management proxies will be permitted to use their
discretionary voting authority if such proposal is raised at the 2001 Annual
Meeting, without any discussion of the matter in the proxy statement.
A stockholder's notice with respect to a director nomination must set
forth (i) certain information about the nominee, (ii) consent of the nominee to
serve as a director if elected, (iii) the name and record address of the
nominating stockholder, (iv) the class or series and number of shares of the
Company which are beneficially owned by such stockholder, (v) a description of
all arrangements or understandings between such stockholder and each proposed
nominee and any other person pursuant to which the nominations are to be made,
(vi) a representation that such stockholder intends to appear in person or by
proxy at the meeting to nominate the persons named, and (vii) certain other
information.
The complete By-Law provisions governing these requirements are available
to any stockholder without charge upon request from the Secretary of the
Company.
By Order of the Board of Directors,
/s/ William H. Geary, III
-----------------------------------
WILLIAM H. GEARY, III
Secretary
Dated: April 14, 2000
13
<PAGE> 17
APPENDIX A
COAST DENTAL SERVICES, INC.
2502 ROCKY POINT DRIVE
SUITE 1000
TAMPA, FLORIDA 33607
PROXY FOR THE 2000 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 12, 2000
The undersigned, having received notice of the Annual Meeting of Coast
Dental Services, Inc. to be held at 10:00 a.m. (Eastern Daylight Savings Time),
on Friday, May 12, 2000 (the "Meeting"), hereby designates and appoints Terek
Diasti, DVM and William H. Geary, III, and either of them with authority to act
without the other, as proxies for the undersigned, with full power of
substitution and resubstitution, to vote all of the shares of Common Stock which
the undersigned is entitled to vote at the Meeting and at any adjournment
thereof, such proxies being directed to vote as specified on the reverse side.
In their discretion, the proxies are authorized to vote upon such other
matters as may properly come before the Meeting or any adjournment thereof.
THIS PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS OF COAST DENTAL
SERVICES, INC. AND WILL BE VOTED AS SPECIFIED. IF NOT OTHERWISE SPECIFIED, THE
ABOVE NAMED PROXIES WILL BE VOTED "FOR" PROPOSALS 1 AND 2 AND IN ACCORDANCE WITH
THE RECOMMENDATIONS OF THE BOARD OF DIRECTORS ON ANY OTHER MATTERS THAT MAY
PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT THEREOF, PROVIDED
THAT THIS PROXY WILL NOT BE VOTED TO ELECT MORE THAN THREE DIRECTORS.
(Continued on the reverse side)
<PAGE> 18
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE FOLLOWING MATTERS. PLEASE
MARK AN "X" IN ONE SPACE. TO BE EFFECTIVE, THIS PROXY MUST BE DEPOSITED AT THE
COMPANY'S REGISTRARS NOT LATER THAN 48 HOURS BEFORE THE TIME APPOINTED FOR THE
MEETING. PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE
ENCLOSED ENVELOPE.
1. Proposal to elect the following three (3) nominees as Directors: Terek
Diasti, John H. Kang and Donald R. Millard.
FOR WITHHELD
[ ] [ ]
FOR, EXCEPT VOTE WITHHELD
FOR THE FOLLOWING NOMINEE(S):
-----------------------------------
2. Proposal to ratify Deloitte & Touche, LLP as the Company's independent
auditors until the conclusion of the 2001 Annual Meeting of Stockholders
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Meeting.
Dated __________________________________________
Signature ______________________________________
Signature if held jointly ______________________
IMPORTANT: Please sign exactly as your name
appears on this proxy and mail promptly in the
enclosed envelope. If you sign as agent or in any
other capacity, please state the capacity in
which you sign.
